Human Resource Activities of GrameenPhone Limited
GrameenPhone Ltd. has stepped into its 13th year of operation, having completed its 10th year on March 26, 2007. It is the leading telecommunications service provider in the country with more than 14 million subscribers as of June 2007. GrameenPhone has been recognized for building a quality network with the widest coverage across the country while offering innovative products and services and committed after-sales service.
Main Subject of Topic:
Main subject of topic of this report is “An Overview of GrameenPhone Ltd., Human Resource Activities of the organization”.
Objectives of the study:
- To discuss about telecommunication business in Bangladesh.
- To present a background and introduction of GrameenPhone Ltd.
- To focus on the business and operations of the company.
- To discuss about Human resource Planning (HRP).
- To discuss about Recruitment and Recruitment Policies.
- To discuss about selection.
- To discuss about Training and Development.
- To discuss about Transfer, Termination and Other Disciplinary Action.
- To discuss about Benefits, Leave and Other Allowances.
- Analysis of Financial Statement of the Organization.
- To have Knowledge on GrameenPhone Ltd. and Mobile
- To improve corresponding and report writing ability.
- To fulfill requirement of the internship program.
For the purpose of the study data and information have been collected from both primary and secondary sources. The relevant information collected from primary sources is collected in an informal way. My work experience in GP helped me a lot. Besides this, regular conversations with 20 GP employees and I have interviewed and taken some suggestions orally from the personnel of GrameenPhone Ltd. The secondary sources for data collection were published annual reports, monthly financial newsletters of GP and monthly newsletters of GrameenPhone Ltd
Human Resource Planning (HRP)
Human Resource Planning:
Human Resource planning is the process of getting the right number of qualified and competent people into the tight job at the right time. Putting another way, HR planning is the system of matching the supply of people internally and externally with the openings the company expects to have over a given time frame. The quality of the candidate and his/her expertise are deciding factor how GrameenPhone will succeed in achieving its visions, objectives and tasks.
Human Resource planning in GrameenPhone must be a part of the Company’s overall plan. When drawing up Human resource plans, it is important to take the following factors into consideration:
- Potential/expected workload and expertise requirements and to ensure the optimum and effective utilization of the Human resources for the entire Company, both for current and future requirements.
- Possibilities for greater efficiency through reorganization and the use of tools/facilities, and making adjustments during expansion and contraction.
- Employee turnover/employee mobility
- Potential transfer, promotion, periods of leave etc and design and implement plans to help achieve manpower objective.
Human Resource planning should start at the beginning of the year so that HR can co-ordinate Human Resource planning process at the right time. Also necessary budget provisions are important factor to look into.
Classification of Employees
Regular Employment: Career with GrameenPhone starts with a regular employment; which is permanent in nature.
Contractual Employment: This type of job is project-based in nature. Working hour remaining same as regular employment, the contract is made for a certain period of time, with a fixed salary paid at the end of the day/month. The employment ends when the contract expires.
Part-time Employment: Students are encouraged to apply for this type of job. Working hours are adjusted to match their class schedule and company need. This job also ends upon the completion of contract.
Internship: Upon the completion of graduation courses, students are assigned internship projects in their area of concentration. Under the supervision of a regular employee, they work for the company for three months to generate a report on the project findings and recommendation.
Industrial Attachment: Students from Engineering/Technical institutes spend some time in the company to get real life exposure related to their theoretical knowledge. During this tenure, technical experts in our company guide them accordingly that helps to enhance their knowledge.
Recruitment process ideally begins with the analysis of job description and person specification for that job. A job description and analysis of person specification provide the foundation for stipulating the job title and salary scale of the position. Person specification defines the education, training, experience, and competencies required by the job holder. The person specification is vital, because the key part of the person specification, established at the beginning, is used in structured selection interview.
Job description is the basis of GrameenPhone’s recruitment, selection and placement, training, performance appraisal, salary administration, promotion and other personal actions for its employees.
Job description is prepared by respective Head of the Department and a copy of it is sent to HR. in case there is any change in the duties and responsibilities, then job description must be revised. A copy of the latest job description is kept in employee’s personal file.
The appointing authority and the line manager shall ensure that each employee has an appropriate and updated job description stating clearly the context, purpose, organogram, duties and responsibilities of the employees and person specification.
A copy of the job description is provided to the employee when he/she is appointed, promoted, newly assigned or when deemed necessary.
Recruitment & Recruitment Policies
An effective recruitment always starts with the correct selection of sources of human resources. A recruited employee who has not the right skill can not perform effectively. As a result the overall performance level is sure to deteriorate which has significant effect on the Company performance. Therefore, GrameenPhone has been on continuous search of effective recruitment sources.
Internal sources: It is GrameenPhone’s policy to give preference to appoint internal candidates provided that the employee is suitably qualified for the vacant or new position and also meets the existing and future requirements. Appointments may be made by the way of promotion, upgradation, secondment or transfer with the approval of the authority. No one is allowed to apply for appointment during probationary period. Promoting internal employees on the basis of succession planning may also be looked into. “As a usual procedure, job vacancies in GrameenPhone will be advertised through internal notices to the concerned offices.
External sources: Whenever job vacancies are required to be circulated outside, the main objective will be to attract a pool of candidates to apply from which qualified candidates for job vacancies can be chosen. Here are a number of external sources that will be used by the company.
Newspaper advertisement: Vacancy announced will be circulated by publishing advertisement in the national newspapers. The newspapers that are widely circulated will be chosen for publishing advertisement, one in English and one in Bangla.
Request to other organizations: In some cases, if deemed necessary, GrameenPhone may request other organizations to circulate job vacancy among their employees. Job vacancy advertisement may be posted in their notice board as well.
Employee referrals: Employees of the Company may refer prospective job seekers to HR Department. There are professional or technical jobs which are frequently harder to fill. Employees with hard-to-find job skills may know others who may meet the desired job requirements and do the same work. In such case, employee referral method may be useful.
Walk-ins and Write-ins: Often Job seekers arrive at HR department in search of a job. They are walk-in people. Write-ins are those who send their curriculum resume for suitable position. Both groups may be asked to fill up an application blank. Their relevant information may be kept in active database file for any suitable position in future. Based on their suitability, they may be called for interview against any vacant position.
Website: Modern information technology such as website http://www.grameenphone.com also is utilized for advertising job vacancy of certain senior positions.
Other: Depending on circumstances, other professional/employment agencies, educational institutes, technical institutes and journals may be chosen to give wider coverage of job openings.
The role of HR personnel is very important in dealing with external job seekers because the outsider individuals draw an impression about the company on the manner their candidature has been dealt with. HR department should greet the candidates in a pleasant manner, provide with pertinent information about job openings, and treat them with dignity and respect. If so, the applicants are expected to develop a listing positive impression about the company.
Selection process includes series of specific steps used to decide who should be hired. Selection process begins when recruitment ends subject to sufficient number of applicants obtained who are willing and able to do hold the job. The purpose of the selection interview is to collect information about a candidate and assess how far he/she can perform in the job.
Selection process involves screening and appraising the applicants in a systematic manner. Those who are found not suitable for the jobs are excluded from selection tests. During selection process, GrameenPhone focuses on performance-related issues whether the applicant fulfils the job requirements and can do the job. The Company uses a multiple cutoff technique including series of screening devices.
Short listing of candidates
Short listing is done on the basis of appraising information on the application form in the light of job specifications of a job being advertised. How far a candidate meets the job criteria will critically be reviewed. The short listing method should be qualitative one where managerial judgment plays an important role.
Short listing depends on the nature of job. Before short listing of candidates for tests, job criteria are set by HR and line manager. There are general and technical job criteria that a candidate has to meet for consideration of next step of selection. HR determines general criteria while line manager determines technical criteria. Although both the type of criteria is important, however, it is the nature of job that determines which type of criteria should give more weightage than other.
Short listing will be done by evaluating the following:
- Educational qualification: whether the candidate has the required education qualification
- Relevant job experience and required skills: how far candidate’s most recent job experiences and skills match the job requirements of the position in question.
The candidate may have irrelevant job experiences and skills that will not be considered during short listing.
GrameenPhone follows a standard set rule of short listing of candidates. For one position the number of candidates for written test should be more than 8. The number of candidate in the oral test should not be more than 4-5.
Role of different departments in short listing
In regard to short listing of candidates, the role of the concerned line manager and HR is crucial. HR is in better position to know exact job specifications, job challenges and job standards; therefore the responsibility of short listing rests on HR.
For non-technical positions, HR will exclusively be preparing short list of candidates. For technical positions, HR will seek line managers input, if necessary. The procedure is that line manager will send technical job criteria to HR who match those criteria and will ultimately candidates.
During short listing the following criteria must be taken into account:
- Type of the position
- Urgency of a personnel
- Career development of the position
- Importance of other related skills for that positions
Administering tests and interview
Following short listing of prospective candidates, internal and external, appropriate employment tests such as written tests, oral tests or any other tests as deemed fit will be arranged to assess candidates suitability for the position. Through the tests candidate’s selected psychological factors such as intelligence, aptitude, temperament and attitude will be measured/observed.
The main focus of employment tests will be on:
- job related questions to assess in-depth knowledge of the candidate
- assessment of mental ability, reasoning, memory etc
- assessment of potentiality and ability to learn
- proficiency in performing tasks
- assessment in line with job analysis
The selection is made on the basis of successive hurdle approach. The candidates will be rejected following each of the stage or test being administered. Performing in one test will not be considered in the succeeding tests rather the performance in the next stage will be decisive factor for selection.
Written and oral test questions will be drafted by HR. A set of questions of technical nature will be drafted by line manager and be sent to HR confidentially from which few will be included random basis by HR. while finalizing test question, HR will stick to job requirements of the position and maintain relevance, consistency and standard on the pattern of questions.
The type of question will depend on the nature of the position. Usually a combination of multiple and narrative type of questions will be set in the written test.
All multiple type of answers will exclusively be checked HR. Also the non-technical narrative part of the written answer papers will be examined by HR while the technical part will be checked by line manager. The compilation of score obtained in written test will be done by HR. It is the responsibility of HR to select and call candidates for subsequent tests based on the performances of written tests.
The minimum qualifying score in the written test is 50%. Candidates who have qualified in the written test will be invited for the next selection test.
Training and Development
GrameenPhone training policy is to support employee training which is directly linked to the individual’s specific jobs and his or her future development. The training program is expected to enhance job-related knowledge as well as develop technical and/or managerial skills. In addition to training program, employees are encouraged to search and utilize personal developmental opportunities for his/her career progression.
Mode of Training
GrameenPhone organizes in-housing training programs for its employees. Senior staff, in-house trainers, or consultants hired for special purposes provide such training. GrameenPhone provides need-based training to the employees through using appropriate external training institutes.
The company also sends selected employees to other countries for attending need-based technical or management training.
Career planning/development identifies a sequence of development activities, formal and informal, short-term or long term that help make an individual capable of assuming a higher position in future.
Divisions are responsible for selection employees to enhance their performance to take higher responsibility in future. Divisional Head is to facilitate the development of a subscriber’s career.
Management is responsible for providing leadership and ensures effective training programs by investing in training. HR will pay facilitator’s role in career development.
New Employee Orientation Program
When a new employee joins the Company, s/he needs to be introduced to his/her job as well as to the Company. The objectives of the orientation are to welcome the incumbent, orient him/her about the Company’s vision, purpose, values, shareholders, service rules, divisional activities etc. This will make a new recruit feel s/he is part of the Company.
HR will arrange a two-day orientation program as per requirements. The representatives from each division will make divisional presentation. Each employee must attend the next available orientation program from the date of his/her joining.
HR prepares a yearly training calendar based on the identified training needs of the employee. The management team will review and approve the calendar before implementation.
Termination and Other Disciplinary Action
The company has the right to transfer an employee from one location to another at any time, at any circumstances depending on its need. Even a transfer order is delivered at a short notice; the concerned employee must be willing to accept it. By moving people into jobs in the sane grade, managers may be able to improve the utilization of their human resources. Transfer may also be beneficial to job holder, since the experience may provide a person with new skills and a different perspective. All transfer issues are handled by HR. HR issues transfer letter at any time with or without giving any notice period to the employee in consultation with departmental head.
A placement at another location for a period of more than 30 days is treated as transfer. During transfer, an employee’s salary and benefits level remain the same. However, the employee may receive normal relocation facilities such as travel expenses, per diem and hotel rent if located at another place away from the normal location for less than 30days.
For any temporary transfer for a period of more than one month and less than three months, an employee will be entitled to the following transfer benefits:
- Accommodation facilities or alternative arrangement with prior approval from the immediate supervisor
- A disturbance allowance of Tk. 5000 per month
- A return air ticket as per entitlement of the employees once in 30 days.
If a transfer is made on permanent basis then the employee will be eligible for the following benefits:
- Expenses in relating to shifting of personal effects, and
- Disturbance allowance of Tk. 20,000 for Manager and above and Tk. 10000 for DM and below level.
Employees are required to perform and behave acceptably but whenever deficiencies in performance and behavior threaten to interfere with efficient Company operations, they must be corrected.
Termination is a serious course of action that should be considered only when it is clear that less drastic action will not serve the purpose. It is the discretion of the GrameenPhone management to decide which course of action will warrant termination.
GrameenPhone can terminate a permanent employee at any time without assigning any reason whatsoever by serving one hundred and twenty days notice or pay in lieu of such notice.
The employee will be paid gratuity for every completed year of service or for any part thereof in excess of six months, in addition to any other due benefits as per the Company policy.
The probationer will be terminated without any notice or pay.
The termination of contract, unconfirmed or part-time employment will be approved by Head of HR while the termination of Confirmed employee must be approved by Managing Director.
An employee may be discharged from GrameenPhone service for reasons of physical or mental incapacity or continued ill health or other reasons not amounting to misconduct. Discharge is not due to the shortcomings in the employee’s performance.
A medical board comprising 2-3 registered medical practitioners will be formed to examine the employee’s health condition and submit their recommendation. Based on the board’s recommendation, discharge decision will be made.
The discharge of any category of employee will be approved by Managing Director.
The employee will be give one month’s notice or pay in lieu thereof. The employee will also paid gratuity for every completed year of service or for any part thereof in excess of six months, in addition to any other due benefits as per the Company policy.
Resignation and Exit Questionnaire
A permanent employee of GrameenPhone can tender resignation from his/her service by giving one month notice. Failure so submit resignation letter prior to one month notice will result deduction of one month’s basic salary.
The resignation letter is submitted to respective departmental Head who in turn sends a copy of it to HR with his/her acceptance and comments. HR formally issues a resignation acceptance and release order to the resigning employee based on Department Head’s comments. The issuance of release order is contingent on the following:
- The separating employee has handed over the charges to assigned person
- A clearance certificate is obtained from the respective Department head
- The employee has no liability with the Company.
Once resignation acceptance letter has been issued, the employee fills up an “Exit interview Form” and submits it directly to Manager, HR confidentially without copying to any body. The form is kept strictly confidentially and is not a part of employee’s Personnel file.
Objective of Exit questionnaire: The objective of filling an exit questionnaire is to know why the employee leaves the Company. After compiling the information provided in the questionnaire, management examines the causes and takes preventive measures to minimize employee turnovers.
The employee gets usual service benefits and unpaid salary, if any, as per Company policy at the time of leaving the Company.
Benefits. Leave and Other Allowances
Compensation and Benefits
Compensation is what an employee receives in exchange for his/her physical and mental works, and contribution to the company. Compensation does not represent only salary but a wide range of benefits and service are part of the total compensation package. GrameenPhone wishes to pay rewarding and competitive salaries to attract, retain and motivate competent and skilled employees at all levels of the Company. By rewarding and competitive salaries we mean that each employee should be rewarded in accordance with:
- What the post requires,
- How skilled the employee is and
- What the market pays for work of the same type.
GrameenPhone wishes to design a compensation system that has strong positive impact on employees and ultimately on the Company’s performance. Keeping Company’s strategic objectives and unique characteristics and environment in mind, GrameenPhone determines a number of criteria for designing a compensation system. The criteria are:
Internal and external Equity: Internal equity means that there should have fairness of the pay structure within the Company i.e. similar jobs get similar pays. External equity assures that jobs are fairly compensated in comparison with similar jobs in the job market. To achieve internal equity, periodic job evaluation that assesses the relative worth of jobs throughout the Company should be conducted. On the other hand, to achieve external equity, periodic market survey and cost of living adjustment should be taken into account.
Competitiveness: There are obvious affect of market forces on compensation. Compensation must respond to the supply of and demand for employees in the market since employers compete for work force.
Cash and non cash benefits: Cash payment motivates employees through monetary rewards such as salary and allowances. The Company pays cash benefits according to ability to pay. Non cash benefits such as job security and making the job interesting is also taken into account.
Performance based pay: Employee productivity, skills and performance are also important determinants of the compensation system of the Company.
Consistency: All-out efforts are made to ensure that compensation system is consistent with HR policies and it is uniform and stable.
The permanent employees of the Company are eligible to become members of the Provident Fund. Employee contributes 10% of their basic to the provident fund and the Company makes equal contribution to the fund. The Company’s contribution starts once the employee has become permanent employee of the Company.
A Provident Fund Trustee, with separate rules, is formed for managing the provident fund.
The PF maturity period is three years. Employee has to serve minimum three years for being eligible for both employee and company contribution.
Gratuity is paid to an employee for providing a life time service to the Company. The eligibility is minimum five- year service with the Company.
Gratuity is equivalent to one (or more as the case may be) month’s basic based on the last drawn basic salary for every completed year of service or for any part thereof in excess of six months.
Sick leave and related leave
There will be no standard annual entitlement to sick leave. Sick leave at actual will be availed based on advice of registered medical practitioner. For sick leave of three days or more, certification of registered doctor or HSE head is required. An assessment will be carried out by HSE/ medical board if any employee is frequently availing sick leave.
If more than three months leave is necessitated due to occupational injury or on-duty accident, the same will be allowed. However dismemberment/ prolonged sickness more than 3 months will be reviewed by HSE/ board of doctors.
A female is granted maternity leave for a period of 16 weeks. A female employee can avail the maternity leave only twice during her tenure with the company. A female is not entitled to maternity leave unless she has completed a period of not less than nine months immediately preceding the day of the delivery. A pregnant employee should inform in writing to her supervisor confirming her delivery date along with a medical certificate. A female employee should not be dismissed during maternity leave without sufficient cause.
A male employee is granted one week of paternity leave during his child birth. A male employee can avail the maternity leave only twice during his tenure with the company.
The condition is that he stays with his wife and uses the time to look after his family and home. If he does not live with his wife then he has no right to take such leave even if he is the child’s father. Such leave can be taken before and/or after the birth of a child.
An employee will be allowed to avail 25 days of annual leave per annum. Maximum 15 days annual leave will be carried forward to the succeeding year, if any, and excess of 15 days annual leave as of December 31st will be forfeited automatically.
Every employee must avail 5 annual leave at a time in a calendar year, proportionate annual leave will apply in that case.
All leave application shall be made by using a standard Registration of leave/Absence Form. The concerned Unit/Section head shall approve the leave by signing the form. The employee will provide full address on the leave form during the period of leave applied for. At the time, they leave place of posting that must also be intimated with new address. In the event requested leave is not approved or the approved leave is canceled, then the reasons for refusal or cancellation shall be recorded on the form. Such form will be part of employee’s leave retained by HR.
- Being the largest player in the market, GP has a considerable amount of hold in the market. The strengths of GrameenPhone are as follows:
- Established Brand: The branding activities have led GrameenPhone to build a strong brand. The mother brand is placed on the same platform as other renowned brands like British American Tobacco, Citicorp etc in Bangladesh.
- Low start up cost: A low start up cost required to reach out to the public.
- Individualism: Although GrameenPhone has close affiliation with its multinational parent company, GrameenPhone has an independent brand identity in the market.
- Experience in telecom market: Most of the Point of Sale (POS) i.e. the GP outlets has experience on selling telecom product. GP has the largest distribution channel in Bangladesh, which enables to offer their product in every corner of Bangladesh.
- Well located Point of Sales (POS): All the POS’s are situated in good location, which ensures easy access for all the consumers of the product.
- Economies of scale: GP has now reached a stage where it enjoys economies of scale to the fullest extent. If any new punk, i.e. any new entrant tries to dig its way in by low tariff, then GP can easily counter that problem by following suit but without any losses as they are low cost producers already.
- Attractive profiling of POS which attracts the customers.
- Wide Acceptability: The branding activities and the service of GrameenPhone have earned 69% of the market share.
- Market Awareness: GP has wide distribution network and good knowledge of this and therefore serves the market demand accordingly.
- Widest Coverage: GP has covered all over the country.
- Extensive Market presence (availability): To make telecommunication accessible to the mass market, GP has set up its POS in the most convenient areas of the districts under the GP network.
- Customers Trust: Wide connectivity, easy communication and affordable price have earned customer confidence and made people depended on GP on a day to day basis.
- Every company has its weak points and GP is no exception to that rule. The weaknesses of GP are:
- No Copyright: The GP brands are not protected by copyrights, which has led to the misuse of the branding attributes and bears the risk of such misusage in future as well.
- Market follower: GP is not market leader as they follow others. GP is good at following suit rather than innovation. The proof of this can be seen now, as its rivals reduce tariffs and increase the increased validity of the prepaid service, GP immediately followed suit. In fact it came up with a whole new package called DJUICE, consisting of reduced call rates. This attitude of GP is a very big weakness as new subscribers are immediately attracted to the price cut of GP’s rivals and by the time GP follows suit, it would have lost the potential subscribers to its rivals.
- Lack of innovation: GP still now does not have the latest mobile Internet technology, which by the way is quite old and did not start MMS, i.e. multimedia messaging. This is a major setback for GP as new funky stuff always attracts young and enthusiastic subscribers and thereby increasing the revenue for GP.
- Lack of working capital for Outlet and Individual agents: This is a major setback for GP as most of the retailers cannot provide optimum service and thereby hurting GP’s image to some extent.
- Lack of well-trained personnel: Because of this, the sales personnel lack the convincing power to convince people to use GP’s connection.
- Sub brands are not well established.
- Billing System: The abrupt barring of connection due to a complicated billing system confuses the customers. Such hassles lead to an unfavorable impression for the company.
- Network Limitation: Call drop, congestion, and poor connectivity with BTTB result in bad image of the company.
- Opportunities for GP are endless. They have the money and experience to diversify.
- The main opportunities for GrameenPhone would be:
- Brand Value of GP: GP products are well known for its services and quality. Because of this goodwill many potential subscribers might be attracted to GP
- To have continuous presence of GP all over Bangladesh.
- Helpful attitude from GP personnel. People want pampering.
- Marketing support provided by GP. The sales and distribution channel is supported by GP, which gives the channel a wider opportunity.
- New licenses complementing GSM telephony.
- Strategic alliances with airtime vendors (service providers) would bring opportunities for further development.
- More international roaming partners.
- Good pre paid service would bring more revenue.
- Ownership of distribution partners.
- Stock return facility. Many retailers are attracted to sell GP products as GP has a policy to take back unsold stock.
- Stock receiving facility on credit. Retailers also appreciate this facility to getting stock on credit and pay later.
- Hand set and Kit lifting from the same point. GP sells all cellular related products at the same place. So it is convenient for the consumer to get every thing under one roof.
- Better utilization of IT resources which would give GP the opportunity for faster growth.
- Sophisticated and flexible billing system.
- Introducing rental phones.
- Increased sale of village phone through Grameen Banks infrastructure.
- Automation of routines and procedures.
- Availability of concern contact point of GP. No matter what the time is, there is always someone at GP to answer all the subscribers’ queries.
- No matter how big or small, companies will always have threats that question their very existence. However some threats remains within the company itself rather than from its rivals or the anticipated newcomers. These threats could arise from the strategies adopted by the company, in this case GP, which prohibit GP to function smoothly.
- The threats for GrameenPhone would be:
- Public demand for discount on price. Everyday consumers are demanding lower tariffs and better quality. This might pose a threat to GP.
- GP is anticipating a possible threat from the new entrant BTTB. The state owned fixed-line monopoly BTTB has entered the market with extremely low tariffs. It is thought that the competitive environment that prevails today might be destabilized as BTTB starts operating at full potential. Currently BTTB poses very little threat to GP as they have just started their operation.
- Fluctuations in the foreign exchange market as another area of concern while possible changes in fiscal policies like the tax regime may also have a negative growth of the mobile phone sector. The import duty on Handsets has been re-fixed at BDT 3000 for a handset costing over BDT 10000 and BDT 4000 for a handset costing over BDT 10000. This would replace the existing BDT 2500 flat rate of import duty on handsets.
- According to recent study, even the existing cost of doing cellular telecom business in Bangladesh is relatively much higher than that of the neighboring countries because of the higher cost of leasing infrastructure, regulatory hindrances, high import duty on handsets, and high cost of interconnection. For example, the infrastructure leasing cost from BTTB per E-1 PCM in Bangladesh is about 10 times higher compared to that in other countries of the south Asian Region.
- Split sale. Day by day consumers are spread out to many other competitors in the market.
- Higher commission provided by the competitor cellular phone providers. This discourages the various sales agent selling GP products
- Lack of interconnection with fixed network
- Inadequate information flow regarding future planning of GP. If the consumer knows the future packages or the coverage expansion of GP in the future, then many subscribers can make decision in buying GP before they even think about other cellular companies.
- Change in regulations having negative effect on its business
- Tremendous sales pressure from GP. The sales and distribution system of GP is under severe pressure all the time to increase the sales figure. We all know that pressure doesn’t always achieve the desired level of sales, but it might disrupt it.
- Political favoritism to other operators.
- Imposing sudden decision. The sales and distribution network has to cope with sudden decisions at times. This hampers the smooth functioning of the entire system.
- Decision making without prior consultation. Some decisions are made without consulting the sales personnel.
- In addition, Voice over IP, launch of new operators and other operators’ prepaid service would be some of the threats for GP.
Interpretation of Ratio Analysis
– Liquidity Ratio covers the four most important ratios. Current ratio expresses that almost in the five years GrameenPhone Ltd. has sufficient current asset in respect with the current liabilities. Quick ratio is also fine but not so much enough in respect with the current liabilities. Cash ratio is also fine from my point of view but cash has opportunity cost also. GrameenPhone Ltd. Maintains huge amount of idle cash which is not so good for any company. Operating Cash Flow ratio is also very fine. They are generating huge cash from their operation.
– Profitability Ratio mainly covers how much profit the organization conducts or achieved by its operation. GrameenPhone’s profitability ratios are very good from the year of 2001 to 2005.
– Leverage Ratio covers the area in which we are discussing that how much borrowed capital the organization gathered in respect to their own equity of shareholder’s equity. In case of GrameenPhone Ltd., the leverage ratio, we can see that they almost dependent on internal liabilities or shareholder’s equity rather than external liabilities
– Interest Coverage Ratio explain us whether we are able to cover interest expenses with our income or not. And from the ratio analysis of GrameenPhone Ltd. from 2001 to 2005 we can see that, GrameenPhone Ltd. can manage or cover interest expense very successfully but trend is in diminishing rate.
The major findings from this report are given below:
- There is no doubt that GrameenPhone Ltd. is the market leader in telecommunication business in Bangladesh.
- The current market share of GrameenPhone Ltd. is 63.9%
- Currently GrameenPhone has more than 14million subscribers.
- It posses a strong financial position. . It has sufficient current asset in respect with the current liabilities. Quick ratio, cash ratio, operating cash flow ratio, leverage ratio, coverage ratio is very fine.
- Though the product offer of GrameenPhone is not attractive compare to other operators, it provides the best network and customer service.
- Its HR policy is very much organized compare to other operators.
Problems and Prospect of the organization
- Sometimes poor network is the vital problem for the subscribers due to some planned works.
- Still all the people of Bangladesh are not under GP network coverage and scope are still there.
- GrameenPhone provides less facility for the subscribers. It charges more for any services than other operators.
- Call waiting time in hotline is high.
- Sometimes users’ dissatisfaction arises due to unavailability of connection facility while there is some planned work or technical upgradation.
- Not enough facilities for subscribers. For example, prepaid subscribes are still getting one friends and family number for low charge while other operators are giving five friends and family numbers. So GP is losing product attractiveness.
- The only way for application, suggestion or any valid reason of any subscriber they need to send FAX which is complicated, time consuming, expensive and also difficult from a remote place.
- Employee motivational training is not improving.
- Recently GrameenPhone Ltd. Charges for transportation facility even for the employees who usually do their office at odd time (other than 8am to 5pm). Recently it creates huge employee dissatisfaction.
- Current limit for post paid subscribers (tk500) is not justifiable for some valued subscribers.
- More emphasis in profit making.
- Most of the customers in Bangladesh are illiterate. Sometimes it becomes very difficult to make them realize about the new product and offer.
In spite of having some problems, prospect of GrameenPhone Ltd. is very good for the following reasons:
- Strong network all over Bangladesh
- EDGE service is excellent. Now the subscribers can get a faster internet, wap and mms services.
- New offers like group talk, EISD, free BTTB and ISD incoming call have been introduced and there are so many upcoming events.
- New value added services like pay for me service is going to make the GrameenPhone’s product more attractive.
- High-quality customer service and customer manager have made GrameenPhone unique than other operators.
- Country best call center makes the customer satisfied. In 2007 its target is to be the best call center in South-East Asia.
- Strong management team, highly committed employees and good corporate environment of GrameenPhone are helping the company to sustain as the market leader.
- Online solution (grahok kotha online) is making the organization more acceptable than other operators.
Now a day, mobile phone is a necessity, not a luxury. So the prospect of mobile industry is very good. GrameenPhone has still has the opportunity to provide better product and services to attract more customers. As GrameenPhone gathered lot of confidence of customers by providing better services, the prospect of GrameenPhone is very good.
Recommendations and Conclusion
After all the analysis and the findings about GrameenPhone, my recommendations are given below:
To the GrameenPhone authority:
Network Availability: Sometimes poor network is the vital problem for the subscribers due to some planned works. So it should be solved technically to ensure the users to enjoy full fledge of networks. If GP is having lack of technical equipment or technical hands they should immediately fulfilled the desired necessity.
Coverage: Main attraction behind GrameenPhone Services is the nation-wide roaming facility; but still needs to increase the coverage and scope are still there.
Charge: Grameen Phones provides less facility for the subscribers. It should charge the users the least amount as its intention should be in long run, economies of scale.
Hotline: GP should train its customer relation people well enough to solve the problems customers on the hotline. Call waiting time should be minimized. Also number of customer relation employees should be increased in relation to increase in sales. GP can provide less charge hotline to serve their existing subscriber more effectively.
Availability of Connection: Sometimes users’ dissatisfaction arises due to unavailability of connection facility, because no one usually can get connected at once while there is some planned work or technical upgradation. This problem should be immediately solved to increase customer satisfaction.
Features: GP should try to increase the features which are supported by GSM features. For example, 3 Friends and Family number for prepaid numbers.
FAX: The only way for application, suggestion or any valid reason of any subscriber they need to send FAX which is complicated, time consuming, expensive and also difficult from a remote place. GP can arrange some other procedure for their valuable subscriber.
– Other problems like unavailability of Pre-Paid cards should be resolved.
– GP can add disaster SMS for the customer.
- The company should efficient courier services to reach the bill to the right customer as soon as possible.
- Number of BTS station needs to increase to increase the capacity.
- Credit Control system should be improved
To the User’s:
Patience: User’s should increase their patience and must build the confidence level on GrameenPhone. In today’s business, organization can’t sustain without customer satisfaction, since competitors are here, so definitely customers will be attracted with new facility.
Good News: After a long time, GP is the only company to make mobile “a necessity, not a luxury.” The way technology is improving, GP should be given some time to re-engineer/redesign their benchmark to find what should be ideal for customers.
GrameenPhone still has a positive image in the Mobile market. Due to its various innovative products and wide market coverage, strong network, at cheap rate with various service centers and its value added services, it can be considered as the market leader in the telecommunication industry and its competitors are far behind. The Pre-Paid System has huge market demand. The people, process and physical evidence of its services, builds the image and demand of GrameenPhone. By people it is meant the employees who interact with the customers directly, and the company’s customers. Gaps in physical evidence occurs when customer’s have problems with their SIM (lost SIM, blocked, card error etc), handset, or any other problem regarding connection that takes place due to the customer’s own fault. As subscriber’s has to pay for any replacement, they feel these hassles and costs could have been avoided if GrameenPhone wished. GP could have avoid these problems through training their customers on the proper use of handling phones, training on handsets and also informing them about the rules and regulations of the company individually as a part of value added service.
Appropriateness of technology in the context of a poor economy is not an issue, the appropriateness of institutions is. Institutions need to be developed that can deliver the technology to the common people so that they themselves can harness its power. Just as aspirin lowers fevers in both adults and children but children need syrups while adults can handle tablets, special delivery mechanisms may need to be developed for growing needs of the technology. GrameenPhone has not created any new technology, but it has established a new way, compatible with economic and social circumstances in rural Bangladesh, to provide access to telephones for the rural people in Bangladesh.
Country like Bangladesh, where people have dreams, not the ability. Besides, the real truth “whether technology drive strategy or strategy drives technology” – is a challenge for the organization in the dynamic world. So, a big question mark is still there, between the GrameenPhone and user group. – How much to provide, what should be the ideal limit, what should be the charge, are they liable to change, viable to operate in the locality, and are the people really want those extra? Therefore, GP will go for the user to solve or consider it as mission impossible!!